Tuesday, May 31, 2011

A recent article concerning several suicides at the Korea Advanced Institute of Science and Technology pointed out that a high powered incentive system might possibly be implicated.

Elite South Korean University Rattled by Suicides
"Mr. Suh also engineered a system that required students to pay extra tuition for each hundredth of a point that their grade point average fell below 3.0 (based on a 4.3-point system). All students pay a token fee each semester, Kaist administrators said, but otherwise their tuition is free, financed by government scholarships.

"Under the so-called punitive tuition program, a bad semester could cost a student’s family thousands of dollars.

"The program, which was applauded at first, has since led to deep humiliation and anxiety among many students. Those who struggled and lost their full rides suddenly saw themselves as losers. Some critics, calling it ruthless, even blamed the program for the recent suicides."

Monday, May 30, 2011

That's the title of a new paper by Yeon-Koo Che, Syngjoo Choi, and Jinwoo Kim.

Abstract:
We study the Generalized Second Price auctions—a standard method for allocating online search advertising—experimentally, considering both the static environment assumed by the prevailing theory and a dynamic game capturing the salient aspects of real-world search advertising auctions. We find that subjects tend to overbid in both treatments relative to the Vickrey-Clarke-Groves outcome suggested as most plausible by the theory, but that their behavior in the dynamic game resembles the behavior in the static game. Our analysis thus lends support to the use of a static game as modeling proxy, but calls into question the prevailing equilibrium predictions.

"Last week, surgeons at Walter Reed performed four surgeries involving two couples in a chain of kidney transplant surgeries that began May 5 at hospitals within the National Capital Region — only the second kidney-paired swap in military history.
...
"Walter Reed surgeons participated in the first-ever transplant involved in a kidney swap chain for a U.S. military treatment facility in November. Retired Marine Gunnery Sgt. Joe Pinkowski received a kidney from a donor, and doctors recovered a kidney from his wife, Yolanda, for a patient at another hospital. The surgeries were a part of a record-setting kidney swap involving the couple and 24 other individuals in a series of 26 operations over six days at four hospitals in the region, saving the lives of 13 kidney patients ."
*********

"For the first time since North Shore University Hospital established its Kidney Transplant Program in 2007, the transplant team headed by Ernesto Molmenti, MD, the program’s surgical director, and Louis Kavoussi, MD the North Shore-LIJ Health System’s chair of urology, performed a three-way kidney exchange involving donors who were unknown to the recipients until today. The donor chain starts with a person who wants to donate a kidney to a loved one or friend. That kidney is transplanted into a recipient who had a donor willing to give, but was found to be incompatible. To keep the chain going, the donor from the first pair gives a kidney to a patient he doesn’t know but who is a match. Specialized testing determines compatibility in each donor/recipient pairing.

"And so it was with the six people who came together today. Darlene Rawlins, 54, of Baldwin, had been on dialysis for two years. She had hoped that her daughter, Contrina Rawlins-Pettway, 26, also of Baldwin, could donate a kidney, but testing found that the two were incompatible. Same with Jacqueline Gonzalez, 46, of Hollis, who had hoped to receive a kidney from her son, Karl Jordan, 27, also of Hollis. Unfortunately, they were also not a match.

"The third pairing in the three-way exchange involved Steve Michalik, 64, of North Carolina, a bodybuilder who won 22 titles during the 1970s and 1980s, including Mr. USA in 1971, Mr. America in 1972 and Mr. Universe in 1975, against such competitors as Arnold Schwarzenegger and the “Incredible Hulk” Lou Ferrigno. Mr. Michalik asked his good friend Martin Hein Andersen, of Denmark, for a kidney. Participating in today’s news conference via Skype from Denmark, Mr. Andersen travelled to New York to get tested, but he too received the same news -- the two were incompatible.

"But thanks to the latest technology, teamwork and sophisticated testing, the transplant staff at NSUH found a way to make the three-way swap possible. On April 25, Dr. Kavoussi removed the kidneys laparoscopically from the donors and Dr. Molmenti surgically implanted them in each of the recipients. Most returned home three days later."

Saturday, May 28, 2011

"T. Boone Pickens, from his autobiography The Luckiest Guy in the World:

I believe the greatest opportunity lies in a free marketplace. There are powerful forces afoot trying to restrict that freedom in the interests of the vested and already wealthy.

"T. Boone Pickens, in congressional testimony on a bill to prevent the slaughter of horses for food:

The whole thing, it’s a boondoggle on the American people…People that are for the slaughter should be forced to go down on that kill floor…The brutal slaughter of horses for consumption by wealthy diners in Europe and Japan cuts against our moral and cultural fiber — it’s just plain un-American.

"Remember, if they can come after the horse slaughterers, they can come after the hedge funds. So if you really believe in free markets, have some horse today!"
********

I'm inclined to think that Mr. Pickens is being neither inconsistent nor hypocritical, but rather that he has opinions about the proper scope of markets.

When Steve Leider and I surveyed people on their attitudes towards whether kidneys should be for sale, one set of questions we asked concerned attitudes towards markets.

We measured agreement with statements that markets cause “an unfair distribution of income,” “rewards people fairly,” “lead to an efficient use of resources,” “require a lot of government control,” and are overall “fair and ethical.” However there was no correlation between disliking markets generally and disliking a market for kidneys: if anything, social conservatism was a predictor of dislike of kidney markets, and that was correlated with approval of markets generally. So, a picture began to emerge of people who liked markets generally, but thought they should they should not be extended into certain domains. Maybe that's the view T. Boone Pickens is expressing.

With a Start-Up Company, a Ride Is Just a Tap of an App Away
"Uber, a start-up based in San Francisco, offers a cellphone application that is aimed at making using a car service quick and painless...."Uber is not a taxi or limousine company. Instead it operates as a dispatch service, working with local owners of licensed private car companies. Uber provides each car with aniPhoneand software that manages incoming requests. When an Uber user needs a ride, the dispatcher and the closest car are notified, and the system sends back an estimate of the pick-up time. While they wait, users can monitor the car’s location on their phone."..."Uber, which is available for the iPhone andAndroiddevices, requires users to enter their credit card information when they sign up. When they reach their destination, they can simply hop out, and the ride is charged to the card. Uber gets a percentage of each fare; the rest goes to the car services and drivers."

Thursday, May 26, 2011

"...a Georgetown University study of the class of 2010 at the country’s 193 most selective colleges. As entering freshmen, only 15 percent of students came from the bottom half of the income distribution. Sixty-seven percent came from the highest-earning fourth of the distribution. These statistics mean that on many campuses affluent students outnumber middle-class students.

“We claim to be part of the American dream and of a system based on merit and opportunity and talent,” Mr. Marx says. “Yet if at the top places, two-thirds of the students come from the top quartile and only 5 percent come from the bottom quartile, then we are actually part of the problem of the growing economic divide rather than part of the solution.”
********

In case you don't know income quartiles off the top of your head, here they are (in much more detail than just quartiles, estimated for 2011) from the Tax Policy Center. The median income for a married couple filing jointly is estimated to be $75,000, and the 75th percentile is $130,000 (the 99th percentile is $762,000).

Wednesday, May 25, 2011

In a News and Views article in Nature Reviews Nephrology, Frank Delmonico describes commercial transplantation in China as still depending on organs from executed prisoners, and comments on a recent paper comparing the health outcomes of transplant tourist patients and other transplant patients, all from Taiwan.

Tuesday, May 24, 2011

Minn. Voters Will Decide on Gay Marriage Ban
"After nearly six hours of emotional debate, a proposed constitutional amendment that would define marriage as between a man and a woman was approved in the Minnesota House late Saturday night. It was the last legislative step needed to put the question on the statewide ballot in November 2012.

"State law already prohibits gay marriage, but supporters of the proposed amendment said it's necessary to prevent judges or lawmakers from legalizing it in the future. Opponents said the constitution should be used to expand rights, not limit them, and predicted a long, divisive debate over the next 18 months.

"The House voted 70-62 mostly along party lines in the GOP-controlled chamber, though four Republicans crossed over to vote 'no' while two Democrats voted in favor of the ban."
********

"The newly recruited donors argue that permitting same-sex marriage is consistent with conservative principles of personal liberty and small government."

***********

Mercenaries in the UAE: Secret Desert Force Set Up by Blackwater’s Founder
"In outsourcing critical parts of their defense to mercenaries — the soldiers of choice for medieval kings, Italian Renaissance dukes and African dictators — the Emiratis have begun a new era in the boom in wartime contracting that began after the Sept. 11, 2001, attacks. And by relying on a force largely created by Americans, they have introduced a volatile element in an already combustible region where the United States is widely viewed with suspicion.
...
"Still, it is not clear whether the project has the United States’ official blessing. Legal experts and government officials said some of those involved with the battalion might be breaking federal laws that prohibit American citizens from training foreign troops if they did not secure a license from the State Department."
************

Selling Educational 'Indulgences' in the U.K. (HT Kim Krawiec)
"A fierce debate is raging in the U.K. about a new proposal to let wealthy students pay for places at top universities -- even if they've been rejected through the regular admissions process. As it stands now, British universities have firm quotas for the number of students they can admit, and those places are filled through meritocratic competition. Once you get in, you pay a low, flat fee to attend (about $6,000 a year to attend Oxford). But David Willets, the education minister, is proposing to create new, "off-quota" places, open to students who haven't made the cut, as long as they can afford to pay substantially higher fees. Rage and confusion have been the immediate results of his proposal."

Monday, May 23, 2011

According to this AP article, Bulgaria is experiencing first-hand the concept of repugnant transactions:

"It's a grim reality for patients and families in Bulgaria, a struggling EU nation where donors are troublingly scarce, hospitals are strapped for funds and blood traders — mainly Gypsy, or Roma, men — are thriving...

..once a deal is struck, a donor hanging out nearby — or at most a phone call away — is summoned, and turns up at the blood clinic masquerading as a relative. He gets a proof of donation certificate and sells it to the desperate family. The blood heads off to be checked, and if it is found to be disease-free it goes toward filling the clinic's reserves."

It seems the Bulgarian legal apparatus is largely tolerant of the black market, most likely as it believes it to be a critical driver of blood supply. But one must wonder to what degree the presence of a black market crowds out altruistic donors ("voluntary blood donation has been gradually shrinking here over the past two decades..."). At the same time, a black market is less efficient (from a social standpoint) than a publicly operated market for blood; the middlemen are presumably taking much of the rents. So while the jury is still out on whether enforcement of the ban of blood sales or a public embrace is best, this interior solution cannot be optimal.

So why can't Bulgaria get more people to go under the needle? Repugnance has put the Bulgarians in a prickly (groan) spot.

"Producers of the competitive culinary TV show Top Chef Canada galloped headlong into an internet outcry after news spread about an upcoming episode's focus on horse meat as an ingredient. In the challenge, scheduled to air on May 16th on Food Network Canada, contestants were required to cook traditional French dishes, including both foie gras (also a controversially-obtained food) and horse.

Protesters took to the show's Facebook page after promos for the episode aired, flooding the comments with mentions of Top Chef boycotts, links to anti-horse meat websites and advice on how to contact the show's advertisers. A specifically targeted Facebook group called "Boycott Top Chef – Protect the Horses" was swiftly established as a central location to share resources including educational material and contact information for the show's advertisers and the network's executives.
"Food Network Canada has issued a statement saying, "Please be assured it is not our intention to offend our viewers. The challenge in this episode involves having the competitors create a truly authentic, traditional French menu. One of the most traditional French foods is horsemeat. Horsemeat is also considered a delicacy in many cultures around the world. While we understand that this content may not appeal to all viewers, Food Network Canada aims to engage a wide audience, embracing different food cultures in our programming."

...

"Protesters, however, argue that not only is eating horse meat a moral taboo on par with the consumption of dogs and cats - it's also insufficiently regulated in Canada.

...

While horse meat is not an especially predominant ingredient in Canadian cuisine, and the majority of the meat processed in the country is exported internationally, it can be found for sale in supermarkets and at butcher shops.

Do you think Americans will ever accept horse meat as part of their diet?
- No way. Never. 34.82%
- Only if there is no other option and we run out of other food sources 13.71%
- People don't really care that much what they put in their mouths, so yes 5.55%
- Possibly, but only after its health benefits are really proven 3.47%
- It'll take time, but why not? 14.3%
- It would be a huge success now if it were legal 4.11%
- People might try it as a novelty, but not as a staple - it'll always have a bit of a taboo 13.73%
- Maybe some food freaks will consider it a delicacy, but most people won't touch it 9.28%
- Other (please share below) 1.05%

Abstract:
"The old concept of barter exchange has extended to the modern area of living-donor kidney transplantation, where one incompatible donor-candidate pair is matched to another pair with a complementary incompatibility, such that the donor from one pair gives an organ to a compatible candidate in the other pair and vice versa. Kidney paired donation (KPD) programs provide a unique and important platform for living incompatible donor-candidate pairs to exchange organs in order to achieve mutual benefit. We propose a novel approach to organizing kidney exchanges in an evolving KPD program with advantages, including (i) it allows for a more exible utility-based evaluation of potential kidney transplants; (ii) it takes into consideration stochastic features in managing a KPD program; and (iii) it exploits possible alternative exchanges when the originally planned allocation cannot be fully executed. Another primary contribution of this work is rooted in the development of a comprehensive microsimulation system for simulating and studying various aspects of an evolving KPD program. Various allocations can be obtained using integer programming (IP) techniques and microsimulation models can allow tracking of the evolving KPD over a series of match runs to evaluate different allocation strategies. Simulation studies are provided to illustrate the proposed method."

Design new market mechanisms to deliver better policy outcomesBuild capability in experimental economics and market design methodologies within the VPSLead policy design collaborations between the VPS and the university sector

This role will undertake

Analysis and high level policy advice on applications of market design in the delivery of a wide range of government policy, procurement and resource allocation objectives;

Capacity building in experimental economics and market design within the VPS;

The design of new market based policy instruments and supervision of experimental economics sessions to test and refine new policy instruments; and

Policy collaboration across government and between government and the university sector.

To succeed in this interesting and challenging role you will have:

A PhD in experimental economics;

Experience in the design, conduct and supervision of policy experiments in an economics laboratory environment;

A strong record of achievement with the application of a market design methodology to public policy problems; and

Friday, May 20, 2011

"Harvard’s acceptance rate for legacies has hovered around 30 percent—more than four times the regular admission rate—in recent admissions cycles, Dean of Admissions and Financial Aid William R. Fitzsimmons ’67 told The Crimson in an interview this week.

Fitzsimmons also said that Harvard’s undergraduate population is comprised of approximately 12 to 13 percent legacies, a group he defined as children of Harvard College alumni and Radcliffe College alumnae.

"Fitzsimmons’ comments came the week after a discussion at New York University on legacy admissions between Yale Dean of Undergraduate Admissions Jeffrey Brenzel, senior fellow at The Century Foundation Richard D. Kahlenberg ’85, and Bloomberg News editor at large Daniel L. Golden ’78.

"According to a New York Times story on the event, Brenzel said that Yale rejected 80 percent of its legacy applicants. Brenzel reported that Yale legacies comprise less than 10 percent of the class, according to Kahlenberg.

"Brenzel also said that there is a positive correlation between alumni donations and legacy admissions. According to Brenzel, Yale fundraising suffers when fewer legacies are accepted. Still, he said, this year Yale rejected more children of top donors than it accepted.

...

"Fitzsimmons defended Harvard’s legacy admissions rate.

“If you look at the credentials of Harvard alumni and alumnae sons and daughters, they are better candidates on average,” said Fitzsimmons, part of what he sees as the explanation for the disparity in the acceptance rate. “Very few who apply have no chance of getting in.”

"Because of the family background of legacies, he said, students are more likely to be aware if they are unlikely to be accepted."
********

In other 2011 admissions news...Higher Yield Means Few Waitlist Admissions
"The yield for Harvard College’s Class of 2015 increased to nearly 77 percent, up slightly from 75.5 percent last year, the University announced Thursday morning. The yield at Harvard, which measures what percentage of accepted students choose to attend, is typically among the highest in the nation.

Dean of Admissions and Financial Aid William R. Fitzsimmons ’67 said that he anticipates his office will admit approximately 10-15 students off the waitlist this year, with some decisions potentially coming as early as this Tuesday. This number is far lower than the 50 to 125 students Fitzsimmons previously said his office generally hopes to admit each year."

Thursday, May 19, 2011

Nicholas Kristof's NY Times column today, Getting Smart on Aid, is a paean to randomized trials experiments, and the work of Michael Kremer, Abhijit Banerjee, Esther Duflo, Dean Karlan and others.

It also includes this thought on economics generally:

"When I was in college, I majored in political science. But if I were going through college today, I’d major in economics. It possesses a rigor that other fields in the social sciences don’t — and often greater relevance as well. That’s why economists are shaping national debates about everything from health care to poverty, while political scientists often seem increasingly theoretical and irrelevant.

"Economists are successful imperialists of other disciplines because they have better tools. Educators know far more about schools, but economists have used rigorous statistical methods to answer basic questions: Does having a graduate degree make one a better teacher? (Probably not.) Is money better spent on smaller classes or on better teachers? (Probably better teachers.)"

Wednesday, May 18, 2011

I noticed that you article posted some time ago (Markets for hair, blood, plasma and eggs) contains a link to The Hair Trader which has now closed. I own website BuyandSellHair.com and it has been running for almost a year. It is now the largest hair trading site based on traffic and number of ads listed.

I was hoping that you'd be able to update your link from The Hair Trader to my site. In exchange for your trouble, i'll send you $20 via PayPal - just send me your PayPal email id.

While I didn't take Sunny up on his offer, I did check out his site. The business model is that he charges for ads, but all transactions appear to be between buyers and sellers, and a quick glance suggests that typical sellers are individuals living in the United States.

"During the past two months alone, robbers in quest of human hair have killed a beauty shop supplier in Michigan and carried out heists nationwide in which they have made off with tens of thousands of dollars of hair at a time.
...
"Once stolen, the hair is typically sold on the street or on the Internet, including eBay, shop owners and the police say.

"The most expensive hair type — and the one in highest demand by thieves and paying customers alike — is remy hair, which unlike most other varieties is sold with its outermost cuticle layer intact. This allows it to look more natural and to last longer without tangling. Remy hair from Indian women is the most popular....
"Remy hair from India usually comes from women who have their heads shaved as a sign of having mastered their egos."

**********Hair from India has become controversial in one particular market, since wigs are worn by (among others) some orthodox Jewish married women (who are obliged to cover their heads). There have been some problems with deciding what hair is kosher, relating precisely to the question of whether the hair is cut as part of a religious sacrifice.
(Different orthodox rabbis differ on the question of whether a wig is a proper head covering at all, with some rabbis finding them repugnant.)

"The European Court of Justice (ECJ) has ruled gender based pricing of annuity and insurance contracts is incompatible with human rights.

"The ECJ has confirmed a challenge by Belgian courts asking whether taking gender into account when writing private insurance contracts was incompatible with European anti-discrimination directives.

"The Court has ruled that, in the insurance services sector use of gender bias will be invalid with effect from 21 December 2012.
"Currently the expectation by UK providers that men will live shorter lives means males receive a higher income per year from their annuity contract than women with the same size pension pot."

Ran writes: "Since life expectancy really differs between men and women, and since this is a signal that cannot be manipulated , it was widely used and its ban constitutes a huge problem to the producers."

Monday, May 16, 2011

Katie Silberman, who was kind enough to write to me about her husband Bryan's kidney transplant in an exchange last July, through NEPKE, writes again to give a snapshot of the costs.

"We just received the bill for Bryan's kidney transplant last summer. As an economist, I thought you might be interested in these numbers. I imagine you have asked your students how much a kidney is worth. Well, according to Rhode Island Hospital, $44,895.90! Of course they call it "organ acquisition," since we can't legally buy it. Here is the breakdown of the bill:

Pharmacy 15,356.03

Educ training 160.65

Organ acquisition 44,895.90

M&S supplies 2,382.96

Lab 3,696.65

radiology 282.45

operating room 7,004.55

recovery room 3,713.85

room charges 12,966.00

addl room charges 1,504.00

total $91,963.04

insurance adjust $91,933.14

we owe: $29.90

"As a consumer, the $29.90 is ridiculous, but I'll take it.

"Most importantly, Bryan's health is fantastic, and we have our family back!

best,

Katie"

************

That is of course just the hospital bill, the docs are paid separately.

Katie further writes

"Of course, we pay constant co-pays. In fact, we are now in the process of applying for financial assistance from the pharma companies themselves for Bryan's drugs, which is an entirely different economic/ personal/ political calculus."

***********

NEPKE doesn't charge an organ acquisition fee at the moment, so I assume that line has to do with the evaluation of the donor, cost of the nephrectomy, and subsequent care.

Sunday, May 15, 2011

"1. People think game theory has no place in a marriage. But you told me once that marriage is a big game made up of little games, and the trick is to focus on the big one, not get tripped up by the little ones. Explain.

I don’t recall that conversation, but my answer makes me think that you must have asked me whether game theory helped me get out of doing the dishes. That doesn’t strike me as the right focus, when you’re thinking about someone with whom you’re going to be lovers and friends and parents together, and each other’s closest confidant, most unconditional ally, and most devoted historian. Let’s just say that marriage is a dynamic game that you play over a lifetime."

Thursday, May 12, 2011

"STARA ZAGORA, BULGARIA — In a field outside town, teenage girls in skimpy outfits worked the crowd at what is known locally as the “Gypsy bride market.” Clad by contrast in long velvet skirts and brightly colored headscarves, their proud mothers watched. Gold flashed on necks, fingers, ears and teeth.

"Meet the tinkers of Thrace, semi-nomadic Roma who in the early 21st century are among the few in Europe hewing to ancient ways...."Technically, the young women at this traditional St. Todor’s Day “market” were not for sale. But it is at this fair, held each year on the first Saturday of Orthodox Christian Lent, that the Kalaidzhi (as the estimated 18,000 Thracian tinkers are known) conduct the complex negotiations on a bride price that traditionally lead to marriage.

"The identity of this semi-nomadic Roma group is based on the ancient craft of its menfolk: producing and repairing pots, pans and caldrons. For centuries, these smiths have scattered in ones or twos in Bulgarian villages to practice this craft, and they get together rarely for events like the St. Todor’s fair.

"This is therefore one of the few opportunities for teenagers to meet other Kalaidzhi — and potential spouses. Dating is not really an option when teenage boys and girls are forbidden to meet without an adult. Marriage outside the group is equally taboo.

"Leaning against his car, surveying the scene, Hristos Georgiev, 18, was pleased to be wrapping up negotiations with the father of Donka Dimitrova, an 18-year-old he expected to marry weeks later. Bargaining had narrowed to between 10,000 and 15,000 levs, or $7,500 to $11,300, well more than a year’s worth of the average Bulgarian’s wages of 8,400 levs. He said he saved the money working construction in Cyprus.

"According to Velcho Krustev, an ethnographer with the Bulgarian Academy of Sciences, “the man is not buying a wife, but her virginity.” The payment ensures the bride will be treated well by her new family, he said...."Kalaidzhi are among the most tradition-bound of Roma. But even they are changing — to the distaste of elders like Ivan Kolev, 73.

"While he insisted the bride price would stay — “our people always insist that a girl be a virgin” — he noted that Kalaidzhi women “were much shyer” when he married some 50 years ago. “Now they just elope. Now they go around like Bulgarians.”

Wednesday, May 11, 2011

Judd Kessler defended his dissertation yesterday (successfully, I should add:).

His work includes lab and field investigations of charitable giving, of provision of public goods, of cooperation in the presence or absence of contracts, of team production when pay is equal or unequal, and of the decision to be an organ donor.

His job market paper, “Signals of Support and Public Good Provision,” is unusual in the way it combines experiments both in the field and in the lab. The field experiment involves a big national charity’s regional campaign in about 200 firms, covering around 25,000 employees. One of the treatment conditions involved giving out buttons to all employees, which they could wear if they wished to express support for the charity. This turned out to have a surprisingly large effect on giving: it increased the number of donations and the amount donated by about a third. Another treatment involved giving out raffle tickets to those who contributed, and this did not have a positive effect on giving. The hypothesis is that the buttons (unlike the raffle tickets) provide information to coworkers about the level of support the charity enjoys, and that when they receive positive information about this they are more likely to contribute themselves.

But a field experiment is by nature imperfectly controlled, so Judd also conducted a lab experiment modeled on the field experiment (in which subjects also had an opportunity to contribute to a charity), but with careful controls in place to test for alternative hypotheses. The treatments in the field experiments already suggested that we aren’t seeing increased contributions because of gift exchange (i.e. the button isn’t regarded as a gift, as the raffle tickets might be), and what Judd finds in the lab is that the major effect of seeing another subject who has chosen to wear the button is that it increases a subject’s estimate of what the other subject will give, and this appears to be the mechanism through which contributions are increased. (Subjects also contribute more when wearing a pin, so this is a rational expectation.)

Judd’s field experiment and lab experiment complement each other; the lab experiment couldn’t have given a reliable prediction of the magnitude of the effect Judd observes in the field, while the field experiment leaves open many more hypotheses about the cause of this effect than does the lab experiment.

Tuesday, May 10, 2011

The latest article in the Globe's series on school choice in Boston, by Jenna Russell, makes very graphically a point I like to make by saying that school choice always brings out two political viewpoints. Those who live close to good schools are members of the "walk to school party", while those who don't are members of the "school choice party". In Boston, those interests are accommodated by having half the seats in some schools give a priority for children who live in the "walk zone," while the other half do not. The decision is then made based on the preference lists the families submit (via a deferred acceptance algorithm that makes it safe for families to reveal their preferences), with ties broken by lottery.

The article focuses on two children, one of whom lives right across the street from a good school and one who doesn't. The kindergarten only has 32 places, only 16 of which are reserved for local children, with the other 16 giving everyone equal access. Since there are lots of ties, the lottery is important.

"The system seems deeply regrettable to her parents, Jen and Doug Bowen-Flynn. But to Marie and Markel Wade of Dor chester, it is a blessing. They, too, live steps away from an elementary school. If school assignments were based on proximity, they would have no choice but to send their children to Winthrop Elementary, which has lower test scores and a less polished reputation.

Instead, because of a lottery that gives all students a chance to seek a seat at better-regarded schools, it is they who send their children to the school on Sawyer’s doorstep."

(Our papers on the design of the Boston school choice mechanism here.)

Monday, May 9, 2011

"Officials estimate that each year in the Washington area alone, hundreds of cars are stolen and shipped overseas. New York authorities announced last June that they had charged 17 people with stealing and shipping hundreds of luxury cars. Other D.C. area police officials and a spokesman for the FBI’s Baltimore Field Office said their detectives have worked similar cases.
...
"The ring’s bosses are usually based in African countries or other developing nations, where it is more difficult to find reasonably priced, mid- to high-end vehicles, authorities said. They order specific cars from middlemen in the United States, and then low-level thieves set out to get their cut.

"In the Prince George’s ring, the thieves are paid according to the vehicles they carjack or steal — $1,500 for a Toyota Camry, $2,500 for a RAV4, $5,000 for a Porsche Cayenne, Aponte said. The middlemen handle the rest. They stash the stolen cars in parking lots or neighborhoods, waiting to see whether police are on their trail. Then they load the vehicles onto shipping containers bound for Africa, police said. The rings are especially prevalent in the D.C. area, police said, because of its proximity to ports."

Sunday, May 8, 2011

"Garum Tesfaye is one of Addis Ababa's "newspaper landlords," a group of entrepreneurs in the Ethiopian capital who rent out papers to people too poor to buy them.
...
"For 20 to 30 minutes, these readers can get their hands on a newspaper for a fraction of the price of having to buy it. If they keep the paper longer than their allotted rental time, they have to pay extra.
"A newspaper in Addis Ababa costs about six birr (35 U.S. cents) to buy. In contrast, it costs only 50 Ethiopian cents (less than one U.S. cent) to rent one.
"If 20 readers read this single paper at the rate of 50 cents, I will make 10 birr (about 60 U.S. cents)," says Tesfaye, whose business serves a regular customer base that visits his makeshift roadside shop each day.
"Most of the readers focus on vacancies rather than regular news," Tesfaye says."

Saturday, May 7, 2011

An article in the NY Times discusses the plight of 8th graders who do not match to a school in the main round of the high school match: Lost in the School Choice Maze

Many of the unmatched children interviewed in the story, who now have to participate in an additional round of matching to get their school assignments, only ranked a few school programs (instead of the 12 they are allowed to rank), and also seem to have received bad advice in other ways, like the child mentioned at the end of this quoted section.

"This year, of the 78,747 students who applied, the computer matched 83 percent to one of their top five choices. An additional 7 percent were matched to schools lower on their lists. The rest, like Radcliffe, were unmatched. Over the past three years, officials said, there has been a slight but steady increase in the number of unmatched students, up from 8 percent last year and 7 percent in 2009.
One new variable this year was the department’s publishing of graduation rates in school descriptions, which caused a surge in applications to the best schools, said Robert Sanft, the chief executive of the Office of Student Enrollment. The competition at many of those top schools meant long-to-impossible odds. Baruch College Campus High School, with a 100 percent graduation rate, received the most applications from across the city: 7,606 for 120 seats, giving it an acceptance rate of about 1.6 percent (Harvard, by contrast, accepted 6.2 percent of its applicants.)
But geography was a significant factor for Baruch, especially for those who, like Radcliffe, applied from outside Manhattan. According to Baruch’s principal, Alicia Perez-Katz, the school, created for Manhattan’s District 2, has not accepted out-of-district students in many years, a fact not mentioned in the Education Department’s school profile."

At the beginning of April, I responded to an email describing the plight of an unmatched student (who had only applied to six programs, none of which, I am informed, had ever accepted a student with his solid but not spectacular math grades), as follows.

Dear Jimmy: I'm sorry to hear that you weren't matched in the main round of the high school admissions process. I know that is very stressful.

I helped design the choice algorithm in 2003-04, but I have no role in its continued operation, and I don't know which schools may be available now. So you need to get advice from people with current, hands-on experience. Your guidance counselor might be a good person to start with, on Monday if you can.

You may also be able to get some information now from the Office of Student Enrollment Planning and Operations (OSEPO). At the very least they can give you the information you will need to participate in the appeals process.

If you don't get into a school you are happy with, there are transfer options that you can pursue to change schools for 10th grade.

I hope you won't give up on your ambition to go to Harvard after you graduate from high school. I'll be very glad to meet you if you come here. But when it comes time to apply to colleges, bear in mind that admission to Harvard and other top universities is very competitive, so be sure to apply to other schools, including some safe schools.

Best of luck,

Al Roth"

So, for next year, I have two bits of advice, for students and for the schools.

For schools and guidance counselors: give these kids more useful advice! They should be told if the lists they are submitting include only schools for which they have little or no chance of being accepted.

Friday, May 6, 2011

Abstract: The years since 1994 have witnessed the emergence of market design as a new discipline within economics, in which research and practice exert powerful mutual influences in matching and auction markets. The problem of designing well-functioning auction markets has led economic designers to revisit such fundamental issues as the definitions of commodities, the ways participants communicate with markets, the trade-offs between the incentives provided for truthful reporting and other attributes of mechanism performance, and the determinants of the scope of markets, especially whether and how trade in different goods is linked.

"The swap at California Pacific Medical Center took place on Friday during a series of operations, the San Francisco Chronicle reports.

"This has been bread-and-butter for us for a few years; we've just never done one of this size," said Dr. Steve Katznelson, medical director of California Pacific's kidney transplant program. "There are all sorts of logistics involved, and it's hard to do."
******

Kidney exchange in India is still rare (but not rare like a unicorn): Two women in kidney swap to save life of other’s spouse
"Dr H Sudarshan Ballal, medical director and chairman, medical advisory board of Manipal Health Enterprises, said swap transplants are common in the US but not so in India. "One of my earlier patient was a middle-aged woman whose husband was a potential donor but incompatible with her. They migrated to the US and later told me they had done a swap with a Jewish couple there. We've been trying for a long time to make swap transplants happen but managed it this time," he said. "

****
Here's an account of a non-simultaneous nondirected donor chain at St. Barnabas hospital in New Jersey, conducted around Valentine's day, with reporting of an April 2011 meeting of patients and donors: Donors, recipients in chain of eight kidney transplants gather for reunion.
The non-directed donor chose to remain anonymous "I’ve got some new scars, but that’s it," the donor said. "I’d rather it not be a big deal."

Tuesday, May 3, 2011

A much blogged about article in the NY Times discusses how law schools offer many admitted students merit scholarships whose continuation depends on their maintaining a certain grade point average. The article notes that, coupled with forced-curve grading policies, this sometimes means that many of those with first year scholarships will inevitably fail to maintain their eligibility for continued scholarship assistance. It argues that the algorithm used by US News and World Report to rank law schools plays a role, by focusing on statistics for the entering class.

"The short answer is this: to build the best class that money can buy, and with it, prestige. But these grant programs often succeed at the expense of students, who in many cases figure out the perils of the merit scholarship game far too late.

"On the Golden Gate campus recently, a group of first-year students at risk of losing their scholarships were trying to make sense of the system. Most declined to be identified for this article because criticizing the school seemed, at minimum, undiplomatic. But the phrase “bait and switch” came up a lot. Several assumed that they were given what is essentially a discount to get them in the door.
...
"If it sounds absurd that America’s legal education system could be whipsawed by, of all things, U.S. News, you have yet to grasp the law school fixation with rankings. Unlike undergraduate colleges, law schools share far more similarities than differences, particularly in the first-year curriculum.

"So a lot of schools regard the rankings as their best chance to establish a place in the educational hierarchy, which has implications for the quality of students that apply, the caliber of law firms that come to recruit, and more. Striving for a high U.S. News ranking consumes the bulk of the marketing budget of a vast number of schools.

"Which is where scholarships come in.

"The algorithm used by U.S. News puts a heavy emphasis on college grade-point averages and Law School Admission Test scores. Together, those two numbers determine about 22 percent of a school’s ranking. The bar passage rate, which correlates strongly with undergraduate G.P.A.’s and LSAT scores, is worth an additional two points in the algorithm. In short, students’ academic credentials determine close to a quarter of a school’s rank — the largest factor that schools can directly control. "

Monday, May 2, 2011

Any venue in which lots of single people invest time and energy in something that interests them can provide the thickness needed for an effective mating market. You can get a date by being an active Yelp reviewer*, and, it turns out, World of Warcraft isn't bad either, as Stephanie Rosenbloom reports in the NY Times: It’s Love at First Kill

"With more than 12 million subscribers, World of Warcraft is one of the most popular games of its kind in the world (others includeEverQuest,Aion,Guild Wars). That’s a sizable dating pool.Match.com, by way of comparison, has fewer than 2 million subscribers."

****My new HBS colleague Mike Luca has studied Yelp, including (in passing) the way that they create a social network for their most active reviewers.

Sunday, May 1, 2011

That's the title of this paper by Atila Abdulkadiroglu and Tayfun Sonmez, presented at the 2010 Econometric Society World Congress, in Shanghai.

Yeon-Koo Che has just posted his discussion of that paper. Among other things, he suggests that one reason we don’t see more centralized clearinghouses is that they don’t necessarily create Pareto improvements, and a hybrid approach is worth thinking about. (For example, he speculates, maybe a centralized clearinghouse for college admissions could be started if it explicitly allowed colleges to continue to engage in early admissions, and only tried to organize the "regular admissions" part of the market.)